Named and Open Perils - Homeowners Insurance

As the “hopefully” busy spring housing market closes in we wanted to share some important information regarding homeowners Insurance.

One question we are often asked is – what is a “named” peril or even – what does the term peril mean. Hopefully we will be able to shed a little bit of light on this..

When used in an insurance policy, a peril is a cause of loss, such as fire or theft. When purchasing a policy it is important to understand the difference between an “all perils” basis, or a “named perils” basis.

Named Perils policies list exactly what is covered by the policy (these policies are generally more restrictive).

Open Perils (or All Perils) policies will list what is excluded from coverage.

In general, a dwelling policy usually provides coverage for both the dwelling and contents on a named perils basis, while a homeowners policy usually provides coverage for the dwelling on an all perils basis, and for the contents on a named perils basis.

As always, it is important to speak with your local agent to determine what type of coverage is best for you.

Copied From Investopedia: Investopedia explains Named Perils Insurance Policy
"Suppose a homeownerdoesn't live in an earthquake and flooding prone area, but is still concerned about fire, theft and hail damage. The homeowner may elect to get a named perils policy and only declare coverage against fire, theft and hail, while leaving the earthquake and flooding coverage off the policy.

Keep in mind that a broad coverage policy does not necessarily guarantee your property will be covered against all forms of perils. These policies contain conditions that cover what the insurer thinks are the most likely perils. Therefore it's a good idea for homeowners to check their broad coverage policies to make sure they do cover all the perils that they are concerned about. If the broad policy isn't sufficient, homeowners should buy a named peril policy to fill that hole in their coverage."

Thanks for reading!

Please remember Sanviti Insurance & Mystic Insurance for all your Auto, Commercial and Homeowners Insurance needs. We work hard to give you the coverage you need at the rate you deserve. Please contact us today at 617-389-2020 or info@sanvitiagency.com